A Fair Tax

A Fair Tax
David Schlecht

What is a fair tax?

I’m not surprised when I hear the rich crying and whining about having to pay their fair share. After all, our broken predatory capitalist system requires people to be immoral and predatory to be successful and we wouldn’t expect anything less when it comes to paying back for the wealth this country has given them. What, then, is fair?

Let’s take the plight of the poverty stricken worker, making some CEO rich while she raises her family in poverty. When she goes to the grocery store, she pays sales tax, usually in the range of 7-10%. In other words, this country is taking food off the tables of the poor in order to pay taxes. Another way to look at this is to say that 100% of the poor working mother’s discretionary spending (money she doesn’t need to survive) is spent on taxes. The middle class has a negative savings rate. In other words, all the middle class’ money is going to pay for their dwindling “American Dream”. How much of their discretionary spending is eaten up in taxes? Obviously 100%. This is immoral for so many reasons. How can a society tax their people to death? Shame on us.

Okay, so our government, pandering to the rich, have decided that it’s okay to tax people 100% of their discretionary income. Well, then that means 100% of what the rich make, after paying for a meager middle class life style, should be taxed. But, no, instead the poor and middle class are paying the taxes for the rich. The uber rich are paying about 10% of their discretionary income in taxes while the rest of the country is paying 100%.

If we’re in agreement that we don’t want to tax anyone 100% then it should be pretty obvious that the only moral solution is to levy taxes proportionate to the amount of discretionary income. This is called a progressive tax. In other words, the tax progresses up as the income goes up.

Back in the days when this country used to function successfully, we had a top marginal tax rate of over 90% on the uber rich. Isn’t it time we went back there? Isn’t it the moral thing to do?

Sales taxes, on the other hand, are regressive. They affect the poor considerably more than the rich. Fuel taxes affect the poor disproportionately. Property taxes should be more progressive, with low cost primary homes paying nothing in tax but million-dollar mansions pay a high percentage.